8 Feb 2011
ISRO'S SPECTRUM DEAL HAS CABINET'S NOD !
From Our Delhi Bureau
NEW DELHI: Hyperactive Telecom Minister Kapil Sibal, busy rescuing the
UPA government in the 2G scam ever since he took over after A Raja
resigned in November, finds himself caught up in another spectrum scam
of the Indian Space Research Organisation's gift of 70Mhz dirt cheap
in 2005 to its former officer that is now turning out to be a Rs
2-lakh crore scam.
He was part of the Space Commission as a member in his capacity then
as the minister of state for science and technology that cleared the
deal. And, it was his note on which the deal was sealed with the Union
Cabinet's nod back in 2005. The Cabinet Secretary, then National
Security Adviser (NSA) M K Narayanan, now West Bengal Governor, and
the ISRO chairman were the other members of the Space Commission.
Prime Minister Manmohan Singh cannot wash off his hands in this
scandal as he not only chairs the cabinet meetings but he was also
briefed by Cabinet Secretary K M Chandrasekhar last year on need to
cancel the ISRO's deal at a ridiculously low price of Rs 1000 crores
in view of the huge sums of Rs 1.06 lakh crores received in auction of
the 3G spectrum.
He also heads the Department of Space (DoS) that did not order
cancellation of the ISRO's contract with the Bangalore-based Devas
Multimedia Private Limited headed by ISRO's former scientific advisor
Dr M.G. Chandrasekhar even after getting an opinion from the Law
Ministry last year in response to the Cabinet Secretary's query that
ISRO is within its rights to cancel the contract signed on its behalf
by its commercial arm Antrix Corporation with Devas.
Sibal may also have to explain why the Department of Telecom (DoT) is
sitting over a recommendation of the regulator TRAI (Telecom
Regulatory Authority of India) last May to allow review of the usage
of the spectrum available with various government agencies to enable
it to schedule release of spectrum to the telecom sector for speedier
rollout of the telecom and broadband services in the country.
DoT is the custodian of the spectrum or airways in India and an
estimated 55 per cent of the available 1,161 Mhz spectrum is with the
government agencies including DoS and Defence Ministry.
Though the government may act fast to scuttle the Devas contract to
wriggle out of the direct charges levelled by the Opposition on the
Prime Minister for the scam that is bigger than the irregularities in
the 2G spectrum allocation, it cannot shut off the reality of Davos
attracting huge investments from abroad alike the telcom players
buying 2G airways cheap and selling them at huge profits.
The catch in the Devas contract is that the company can offload the
excess spectrum with it to others if it is not able to utilise all
70Mhz and there is bound to be a huge race among the private telecom
operators to seize part of it instead of knocking doors of DoT all the
time for access to more spectrum.
While Devas offloaded its 36749 shares worth US $75 million to
Singapore-based Deutsche Telekom Asia Pte Ltd, it also took other
investors, many from the tax heaven Mauritius that launders the
Indians' black money received through havala and ploughs it back in
the name of the companies that can be easily registered in that
country.
Two Mauritius-based companies -- CC/Devas (Mauritius) Ltd and Telecom
Devas Mauritius Ltd were issued 15730 convertible cumulative
preferential shares each on March 16, 2006 at a huge premium of Rs
21445.82 for the shares with equity value of Rs 10 each, only few
months after the company got the scarce spectrum. These two Mauritius
companies were further allotted 15,619 shares each in three tranches.
The balance sheet of Devas Multimedia shows that its capital shot up
eight times in only three years from Rs 67.5 crores on March 31, 2007
to Rs 578.82 crores in 2010. In fact, the capital investment went up
by Rs 123 crores in just one year between 2009 and 2010.
Since after allotment of the scarce S-band spectrum, that was once
used by Doordarshan for serving remote areas through satellite, the
company raised several hundred crores and even made investments in
mutual funds and financial institutions.
An interesting alibi from Antrix Corporation Limited that made the
deal with Devas which also includes use of two satellites to be
launched specifically for it is that ISRO was burdened with unused
S-band spectrum that was vacated by Doordarshan and it readily agreed
to give 70 Mhz from it to Devas that approached it. It argues that no
other company had approached it as otherwise they too would have been
given the spectrum instead of letting it lie idle. What an excuse!
###
ISRO'S SPECTRUM DEAL HAS CABINET'S NOD !
From Our Delhi Bureau
NEW DELHI: Hyperactive Telecom Minister Kapil Sibal, busy rescuing the
UPA government in the 2G scam ever since he took over after A Raja
resigned in November, finds himself caught up in another spectrum scam
of the Indian Space Research Organisation's gift of 70Mhz dirt cheap
in 2005 to its former officer that is now turning out to be a Rs
2-lakh crore scam.
He was part of the Space Commission as a member in his capacity then
as the minister of state for science and technology that cleared the
deal. And, it was his note on which the deal was sealed with the Union
Cabinet's nod back in 2005. The Cabinet Secretary, then National
Security Adviser (NSA) M K Narayanan, now West Bengal Governor, and
the ISRO chairman were the other members of the Space Commission.
Prime Minister Manmohan Singh cannot wash off his hands in this
scandal as he not only chairs the cabinet meetings but he was also
briefed by Cabinet Secretary K M Chandrasekhar last year on need to
cancel the ISRO's deal at a ridiculously low price of Rs 1000 crores
in view of the huge sums of Rs 1.06 lakh crores received in auction of
the 3G spectrum.
He also heads the Department of Space (DoS) that did not order
cancellation of the ISRO's contract with the Bangalore-based Devas
Multimedia Private Limited headed by ISRO's former scientific advisor
Dr M.G. Chandrasekhar even after getting an opinion from the Law
Ministry last year in response to the Cabinet Secretary's query that
ISRO is within its rights to cancel the contract signed on its behalf
by its commercial arm Antrix Corporation with Devas.
Sibal may also have to explain why the Department of Telecom (DoT) is
sitting over a recommendation of the regulator TRAI (Telecom
Regulatory Authority of India) last May to allow review of the usage
of the spectrum available with various government agencies to enable
it to schedule release of spectrum to the telecom sector for speedier
rollout of the telecom and broadband services in the country.
DoT is the custodian of the spectrum or airways in India and an
estimated 55 per cent of the available 1,161 Mhz spectrum is with the
government agencies including DoS and Defence Ministry.
Though the government may act fast to scuttle the Devas contract to
wriggle out of the direct charges levelled by the Opposition on the
Prime Minister for the scam that is bigger than the irregularities in
the 2G spectrum allocation, it cannot shut off the reality of Davos
attracting huge investments from abroad alike the telcom players
buying 2G airways cheap and selling them at huge profits.
The catch in the Devas contract is that the company can offload the
excess spectrum with it to others if it is not able to utilise all
70Mhz and there is bound to be a huge race among the private telecom
operators to seize part of it instead of knocking doors of DoT all the
time for access to more spectrum.
While Devas offloaded its 36749 shares worth US $75 million to
Singapore-based Deutsche Telekom Asia Pte Ltd, it also took other
investors, many from the tax heaven Mauritius that launders the
Indians' black money received through havala and ploughs it back in
the name of the companies that can be easily registered in that
country.
Two Mauritius-based companies -- CC/Devas (Mauritius) Ltd and Telecom
Devas Mauritius Ltd were issued 15730 convertible cumulative
preferential shares each on March 16, 2006 at a huge premium of Rs
21445.82 for the shares with equity value of Rs 10 each, only few
months after the company got the scarce spectrum. These two Mauritius
companies were further allotted 15,619 shares each in three tranches.
The balance sheet of Devas Multimedia shows that its capital shot up
eight times in only three years from Rs 67.5 crores on March 31, 2007
to Rs 578.82 crores in 2010. In fact, the capital investment went up
by Rs 123 crores in just one year between 2009 and 2010.
Since after allotment of the scarce S-band spectrum, that was once
used by Doordarshan for serving remote areas through satellite, the
company raised several hundred crores and even made investments in
mutual funds and financial institutions.
An interesting alibi from Antrix Corporation Limited that made the
deal with Devas which also includes use of two satellites to be
launched specifically for it is that ISRO was burdened with unused
S-band spectrum that was vacated by Doordarshan and it readily agreed
to give 70 Mhz from it to Devas that approached it. It argues that no
other company had approached it as otherwise they too would have been
given the spectrum instead of letting it lie idle. What an excuse!
###
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